|March 16th, 2013
Over the last few years political and financial leaders in Europe and the United States have implemented policies, regulations and bailouts costing global taxpayers trillions of dollars with the promise that these measures would lead to economic growth and recovery.
What happened in Europe today is yet further proof that nothing they’ve done has fixed the underlying fundamental issues surrounding the events that led to the crash of 2008.
For those who don’t believe the government is prepared to take extreme measures that may include the seizing of retirement accounts, cash savings or even gold, look no further than Cyprus, the latest recipient of bank bailouts.
As of right now, citizens of Cyprus are scrambling to withdraw funds from their bank accounts after the EU, with agreement from the Cypriot government, announced they will decimate funds held in personal bank accounts to the tune of up to 10% of existing deposits.
You read that right.
The European Union has made the determination that the people of Cyprus are now responsible for the hundreds of billions of dollars in bad bets made by their government and bank financiers, and they are moving to confiscate money directly from the bank accounts of every citizen in the country.
Restrictions have been imposed to stop people emptying their accounts or moving their money out the country after the Cypriot government announced that up to ten per cent of deposits will be seized and used to bailout the island’s crisis-hit banking system.
The deal with other eurozone finance ministers is the first time that ordinary citizens’ deposits have been directly raided in this way.
If savers in other troubled nations fear their accounts might be next, they could withdraw their money and spark a catastrophic run on the banks.
They’re calling it a “tax.”As Market Ticker’s Karl Denninger notes, “Like hell that’s a tax. That’s direct confiscation of the funds of people who did nothing wrong!”It should now be obvious. There is no recovery. There never was.
If you have the majority of your net worth allocated in bank accounts, money market funds, retirement plans, stock markets or the host of other ‘safe’ assets recommended by your financial adviser, then you are playing Russian roulette.
And in this version there’s a bullet in every chamber.